SC upholds Adani’s Hazira port expansion, rejects Essar’s objections

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New Delhi | Published: February 23, 2018 6:25:18 AM

In a major setback to Essar, the Supreme Court on Thursday upheld the Gujarat government’s decision to expand the limits of Adani’s Hazira port in Gujarat.

Adani, Adani Hazira port, Gujarat, Supreme Court, Gujarat Infrastructure Development Act, HPPL, kapil sibalSenior counsel Mihir Joshi, appearing on behalf of Essar, argued that the extension of the limits would grant HPPL an extended port area without bidding, which would be contrary to the Gujarat Infrastructure Development Act, 1999. (PTI)

In a major setback to Essar, the Supreme Court on Thursday upheld the Gujarat government’s decision to expand the limits of Adani’s Hazira port in Gujarat. A bench led by Justice RF Nariman, while dismissing Essar port arm Essar Bulk Terminal (EBTL)’s appeal, approved the state government’s January 18, 2016 notification for expansion of Adani’s Hazira ports on the ground that the impugned notification was not found to be contrary to public interest. The Gujarat High Court had last year rejected the Essar Bulks Terminal’s 2016 petition challenging the notification, issued under the Indian Ports Act 1908, allowing Hazira Port (HPPL) and Adani Hazira Port (AHPL) to expand their port limit in Hazira. “We are not satisfied that the notification is ultra vires Section 5 of the Indian Ports Act, 1908. We have already seen that the appellants (EBTL) have no ‘right’ to private property in view of the fact that the ownership of the captive jetty that has been constructed and the ownership of reclaimed land is with the Gujarat Maritime Board/state government. For this reason also, the notification is intra vires as the alteration in the limits of Hazira Port does not affect any ‘right’ of EBT to private property,” the apex court said in its 45-page judgment.

It noted that Essar had actually dredged the channel to a depth of 14 metres and reclaimed an area of 164 hectares plus 170 hectares to the south of the mangroves without any permission at all. However, the asset to be created belonged only to the Gujarat government and it was for the GMB to grant permission to the company to use the same. Thus, the CRZ clearance by the ministry of environment and forests in May 2014 for reclamation of 334 hectares of land does not further Essar’s case in any way, Justice Nariman said. EBTL had argued that allowing expansion of port limits of Hazira port would infringe on the limits of its Magdalla port and affect its investment of over Rs 1,500 crore on lands reclaimed by them.

Senior counsel Mihir Joshi, appearing on behalf of Essar, argued that the extension of the limits would grant HPPL an extended port area without bidding, which would be contrary to the Gujarat Infrastructure Development Act, 1999. Opposing Essar’s stand, senior counsel Harish Salve on behalf of the state contented that the expansion of port limits was well within the originally conceived area of 1,011 hectares and Essar’s production was much less than what was projected and, in fact, only 30% of the cargo that it was supposed to handle was being handled. He said Essars’ captive jetty was grossly underutilised and its demand for grant of reclaimed land has nothing to do with HPPL demanding an alteration to the limits of Hazria Port.

Senior counsel Kapil Sibal, appearing on behalf of HPPL and Adani, had stated that Essar’s real aim was to conduct commercial operations beyond the captive requirements of its steel plant at Hazira and this would circumvent the need for a global tender as required by the Gujarat Infrastructure Development Act.
Additional solicitor general Tushar Mehta, appearing on behalf of the GMB, supported Salve’s arguments, saying what was done by the state government was in public interest and for good reason.

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